We have a small startup in tamilnadu, employees are involved in recruitment for IT/Non IT. majority of staff is work from home permanently. Should the employer offer letter state the place of work as their home address or should the Head office address?

Also does this qualify under Professional tax.

From United States, Suwanee
Work place is normally the place where employees would be required to work but for the WFH arrangement. It can be the head office or branch office depending on the geographical area of jurisdiction/operation.
Yes, such employees' salaries attract P.T. as if they are working at office.

From India, Salem
Thank you. Let me reframe my 2nd question. Does the role description of employees described attract professional tax (irrespective) of work location
From United States, Suwanee
Profession Tax applies to all salaried employees irrespective of where they are working from (except if they are not in Tamil Nadu)

So if someone works from karnataka, actually you are required to pay his professon tax in karnataka

From India, Mumbai
I am trying to understand if this qualifies under professional tax. Some say yes and some say no.

employees are involved in recruitment for IT/Non IT.

Does employees who do recruitment as a service come under professional tax

From United States, Suwanee
Dear friend,

Professional Tax is a State Tax in India levied and collected by the Local bodies like Municipal Corporations from persons earning income by means of self employment, doing business or any paid employment within the territory of such local body. The rates of P.T and the periodicity of its collection differ from State to State.

Coming to your question, the moment he is called an employee, it implies that his services are hired for salary or reward though he acts as your agent here.

From India, Salem
In case of permanent work from home, you can mention the address of your head office and mention a separate statement specifying that the candidate is hired as a full time employee and he/she is allowed to work from anywhere. (you can modify this statement with all the terms & conditions of your company's work from home rules)
This statement itself defines every condition clearly.

For your second concern, If you are hiring any full time employee on your direct payroll irrespective of the work location then it is mandatory to pay professional tax and for Tamil Nadu it is required.

In case you hire part time/contractual employees, then rules are different. Their Income is taxed as Income from Business/Profession and such employees are also required to maintain a record of all their expenses.

From India, Noida
Anonymous
It should be work from home specified in letter.
From India, Nashik
Thank you all. This helps When raise is provided for employes over the course of the following year, does a new offer letter provided.
From United States, Suwanee
In my understanding, professional tax is to be deducted depending upon the location of the office under which the employee is working. For instance, if the office is in Bangalore and the employee is working from his home in Kerala, his pay liable for professional tax as liable in the State of Karnataka.

Broadly, there are two systems as to levy of professional tax. In Kerala (also, Tamil Nadu), the levy is made by the local bodies. The liability is primarily on the employee to pay the professional tax.

But in the States of Maharashtra, Gujarat, Andhra Pradesh etc. the levy is part of commercial tax and is collected by the concerned department. Deduction of the tax from the employee's pay is the responsibility of the employer.

From India, Kochi

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